France delays move to make Web giants pay for networks

PARIS, Jan 15 (Reuters) - France backed away from
legislation to make Internet companies including Google
pay for the burden they place on telecommunications networks,
opting instead to ask a commission to study the controversial
issue.

Fleur Pellerin, junior minister for the digital economy,
said the government would ask the National Digital Council, a
panel of tech experts and entrepreneurs, to evaluate whether a
law was needed and how it might work.

A decision on how to proceed is due by late February.

France's Socialist government is concerned that Web giants
weigh down networks with traffic without contributing to telecom
companies' investments in high-speed systems, echoing a position
held by European telecom operators.

Big Web companies like Facebook, Google and Netflix
reject the idea of paying telecom operators to have
their content reach customers.

Many argue they already pay for bandwidth through private
deals with "content delivery networks" or sometimes directly
with telcos or cable companies.

Internet activists also oppose paying extra because it would
create two-speed networks and violate the net neutrality
principle that all traffic on the Internet is treated equally
regardless or its source or destination.

France's debate on net neutrality and who should finance
networks arose early in January when the country's
second-biggest broadband provider Iliad launched a
feature to automatically block online advertisements.

The company withdrew the facility after an outcry from Web
publishers and Internet activists, but not before Pellerin said
it had a point.

"What solutions do Internet providers have when faced with
content providers who use their networks but don't invest in
them?" Pellerin said last week.

"We need to ask serious questions about how Web companies
can put some money into networks."

Iliad's move was widely seen as a shot across the bows of
Google because the French broadband provider has long sought,
unsuccessfully, to get the search engine, whose business model
is based ad revenue, to pay for the traffic it sends to French
customers.

Iliad also acknowledges it slows down video-sharing site
YouTube at peak hours, arguing that it congests the networks.

In France, Google has signed deals with Cogent and France
Telecom to deliver its content to French web users.

Net neutrality has been debated by governments and companies
all over the world in recent years as the Internet has grown in
influence and reach.

Only the Netherlands, Chile and Slovenia have passed laws
guaranteeing net neutrality.

In the United States and most of the European Union,
regulators have adopted a more hands-off approach in which
companies reach commercial contracts amongst themselves.

Asked why the French government had decided to wait instead
of proposing a law now, an adviser to Pellerin said there was
not yet consensus among the various players.

"For there to be a draft law, there would have to be a
minimum of consensus between the various actors," said the
adviser. "The debate today showed that we are a long way off."